Chrysler

Tired of all the bad news coming out of the auto industry these days, Consumer Guide went out in search of the positive. In this, the third of three exclusive executive interviews, we talked with Jim Press, Chrysler's Co-President and Vice Chairman.

Press told us why we shouldn't be worrying about the automaker's future. We asked him for three reasons the public should feel good about Chrysler. Our comments follow.

Reason One: Quality and Customer Satisfaction

Jim Press is convinced that with the 2009 Dodge Journey, Chrysler addressed and rectified recent comfort and quality issues that plagued the interiors of other products like the Dodge Caliber and Chrysler Sebring.

Jim Press: Today's Chrysler is a customer-centric organization, dedicated to intently listening to our customers and then acting to serve them. Earlier this year, we created the industry's first online Customer Advisory Board to encourage a direct dialogue with customers and gather insight and fast feedback. We have also established the automotive industry's first-ever Chief Customer Officer to help get our entire organization focused on satisfying customers. Over the past year, we approved more than 400 line-item changes and invested some 500 million dollars in overall fit and finish, in the location of interior controls, in the tactile quality of how doors open and close, in reduced noise and vibration improvements that really matter to customers. Our top executives attend monthly quality reviews where we make key decisions that affect quality. And we have introduced cross-functional Customer Satisfaction Teams. There are 18 of them--one for each major vehicle system such as the interior, wiring, engine, etc.--and they are playing a big role in solving quality issues before they ever get to the customer.

Consumer Guide: Can you give me a recent example of a vehicle that has benefited from the line-item changes, and what those changes were?

Jim Press: You'll see in the Journey that we gave it soft-touch interior surfaces, a high-output engine, and better fuel economy. In the new Ram pickup, we modified the baffles in the muffler's heat shields so that they wouldn't crackle on cool-down. We added sound deadening to some vehicles, a higher-level interior to the Charger and Grand Cherokee, and a no-charge MyGIG to the vans [Chrysler Town & Country and Dodge Grand Caravan].

Note: MyGIG is a Chrysler-branded multimedia entertainment system. The name disappears for 2009, and MyGIG's functions will be bundled with Chrysler's uconnect suite of media products.

Consumer Guide: Can you cite any examples of Customer Advisory Board suggestions that are due to be implemented?

Jim Press: Concerns over fuel economy drove the "Let's Refuel America" program. Customers said they liked the high-line interior in the Chrysler 300C but wanted it available with a V6 engine, and that prompted the Limited model.

Consumer Guide: Did these changes appear more quickly because Chrysler is now a privately held company?

Jim Press: Absolutely. Chrysler is now a lean, quick-footed company. For instance, people liked the under-floor cargo box in the bed of Honda's Ridgeline, but that's not possible in a truck with a full frame. So we added sidewall "trunks" in the bed of the new Ram in space that's normally unused. That change took less than a year. Stow 'n Go seats in the minivans were done in 11 months; that would normally take about three years.

CG Says: While it's probably too soon to gauge the efficacy of Chrysler's Customer Advisory Board--especially since many of the changes to existing product cited were in place or in progress prior to the board's creation--there is strong evidence that Chrysler is responding with new and surprising vigor to product criticism.

Chrysler was deservedly condemned for the cabin fit, finish, and materials quality of a number of recently launched vehicles, most notably the Chrysler Sebring and Dodge Avenger midsize sedans and the compact Dodge Caliber, Jeep Compass, and Jeep Patriot. To what extent these vehicles represented a regrettable corporate paradigm shift to extreme cost cutting is unclear, but subsequent product launches and mid-cycle updates reflect a seeming rethinking of this position.

For 2009, a scant two years after rollout, the Jeep Compass and Patriot have been fitted with improved cabin appointments. And since the Avenger, Sebring, Caliber, Compass, and Patriot rollouts, Chrysler has unveiled two promising vehicles with notably friendlier interior décor.

The 2009 Dodge Journey, a likable, midsize crossover SUV, can hardly be described as a luxury vehicle, but its cabin is handsome, with a sprinkling of soft-touch materials where passengers might most appreciate them.

More promising is the 2009 Dodge Ram large pickup. In its most luxurious Laramie trim level, the new Ram rivals all competitors for cabin appointments and upscale ambiance.

As with the Compass and Patriot, what is most promising here is the quickness with which Chrysler responded to criticism of its interiors. By the time the Avenger, Sebring, Compass, and Patriot were unveiled, the Journey and Ram would have been well along in development.

While a council of consumer advisors sounds like the creation of a company with its finger on the pulse of the buying public, the real news here is not that Chrysler was listening, but that it was able to act so quickly on the feedback.

Reason Two: Emotional Appeal

With the Dodge Challenger, Chrysler built an evocatively styled car with definite emotional appeal.

Jim Press: Chrysler has long understood the visceral connection between driver and vehicle. It starts with design, which is one of our real strengths, and continues with an emotional driving experience. Just look at the new Dodge Challenger--a thoroughly modern interpretation of the classic American muscle coupe. We also understand the need to be environmentally responsible--improved fuel efficiency and reduced emissions are top priorities. The new two-mode hybrid system offered on our Chrysler Aspen and Dodge Durango models is an example of how we're increasing fuel economy while still giving customers the performance and capabilities they expect. We'll be extending our hybrid program, our flex-fuel offerings, our clean diesel entries, and will bring other advanced-propulsion systems to the market. As we do so, we will continue to challenge ourselves to create emotional designs and great driving dynamics that result in vehicles that people will really want to own and drive.

Consumer Guide: What is Chrysler's most emotional product?

Jim Press: Jeep. Jeeps are pure emotion.

Consumer Guide: In a market often described as recessionary, is it difficult to make an emotional appeal? It seems buyer finances and fuel economy concerns could blunt the impact.

Jim Press: In this market, you have to get more granular. Of course, people are concerned about fuel costs. So, we gave the Challenger's Hemi a Multiple Displacement System along with variable valve timing and variable intake for better fuel economy. Challenger buyers like to say they bought a hybrid of their own: It burns both rubber and gas.

CG Says: To a large degree Chrysler has led domestic carmakers in this category, though not with notable consistency.

Chrysler stormed back into the large-car market for 2005 with the Chrysler 300, and a year later with the Dodge Charger. Big, boldly styled, and packing available "HEMI" V8 engines, the new big Chryslers were unapologetically American and an instant hit with buyers; a perfect blend of practical and emotional--and worth more to buyers than the sum of their parts.

Subsequent sedan introductions failed to elicit the same excitement as the 300 and Charger. Looking for lightning to strike twice in the same place, Chrysler relied too heavily on recent design successes for the look of the 2007 Chrysler Sebring and 2008 Dodge Avenger midsize sedans. With styling best described as derivative, the new sedans borrowed design elements from existing Chrysler product almost to the point of parody. Combined with other demerits, both cars met with lukewarm reviews and tepid sales.

The emotion candle has not gone out at Chrysler, however. A trio of concept cars and a recent speech by Jim Press offered some of the best evidence of renewed product passion at the automaker.

At the Detroit Auto Show this past year, the maker rolled out three promising concepts. In terms of efficiently marrying cabin space with progressive design, the Chrysler EcoVoyager, the Dodge Zeo, and (to a lesser extent) the Jeep Renegade concepts were unqualified successes. Assuming that these show cars are a harbinger of coming product, Chrysler is still in the design game.

Another welcome sign of renewed passion at Chrysler came from Press himself during a presentation to the Automotive Press Association (APA). On the topic of the Jeep brand, Press noted, "We need to keep it a genuine Jeep image. We can't dilute it by trying to sell out the volume of the brand on faux Jeeps. We want to return to our roots and have trail-rated authentic Jeeps that have value."

One of the world's strongest brands, and one with the strongest emotional appeal to its loyalists, Jeep took a hit to its credibility when it rolled out the Compass and Patriot last year. Viewed as pretend Jeeps by many, the compact crossover "softroaders" share their basic architecture with the compact Dodge Caliber and, with the exception of a specially optioned Patriot, lack any real off-road capability.

Further, the Compass pays only lip service to traditional Jeep styling, aping only a few key brand elements, like the round headlights and a slotted grille. As the best emotional product appeal is born of the genuine passion of its builder, it's heartening to see that Chrysler is re-embracing what it was that made Jeep owners such a fanatically loyal group.

While show cars and speeches are hardly the foundation of a corporate turnaround, they are strong indications that Chrysler is better focused now than it has been in a long time. If part of that focus is born of real passion, all the better.

Reason Three: Becoming the Best Little Car Company in America

Chrysler plans on narrowing product lines to focus on specific segments. The Crossfire is one casualty of this plan. It won't return for 2009.

Jim Press: Our goal is to be the best little car company in America. That means we will live efficiently within our resources and focus on developing the very best world-class products. We're rationalizing our product portfolio so that we can focus our resources on developing the craftsmanship that customers want. For an example of what we can achieve, look at the Dodge Journey--a crossover with the highest fuel economy in its class, seats up to seven people, with a starting price under $20,000.

Since a year ago when Cerberus acquired a majority stake in Chrysler, we've been the first major North American auto manufacturer to be privately operated in more than 50 years. We don't have Wall Street looking over our shoulder. We can make decisions faster than anyone else, and our execution can be true to our creative concepts. Our agility allows us to respond rapidly to customer needs, market trends, and the opportunity to form strategic alliances with other companies around the world. Private equity also encourages an owner-operator mindset; the payoff is that we are unleashing our spirit of innovation and creativity in order to provide products that will delight our customers.

Consumer Guide: Would it be correct to assume that by referring to Chrysler as "little," reclaiming market share is not a priority, and that some segments might be abandoned because some battles are just not worth fighting?

Jim Press: There's a saying that "volume is vanity, profit is sanity." Some manufacturers are in a battle over sales figures, and the more they sell, the more they lose. The Crossfire wasn't worth building anymore. Fleet sales haven't been profitable, and we're narrowing product lines to avoid duplication. It doesn't make sense, for instance, to build both a Caliber and a Compass, especially if both brands are under one roof. We're looking at expanding heavy-duty trucks, and also getting into new-tech electrified vehicles.

Consumer Guide: By "electrified," do you mean hybrid or pure electric?

Jim Press: Both.

Note: As this was being published, Chrysler revealed three extended-range electric concept vehicles, with plans to bring one to market before the end of 2010.

CG Says: Under new management, it appears Chrysler has shed sentimental notions of regaining or even maintaining market share at the expense of profitability.

To that end, a number of models have recently been dropped from the lineup, among them the aforementioned Chrysler Crossfire, the Chrysler Pacifica, and the Dodge Magnum.

Whether Cerberus is heartless or merely practical remains to be seen. As Press noted in Reason Two, passion is a powerful sales tool, but to what extent Cerberus is able to quantify its value is anybody's guess. Still, this is a good time to be a small, nimble car company. Buyers are more fickle than ever, and the next hot segment is still a secret. The automakers that can react the fastest will reap profits the soonest.

A small Chrysler might be a tough pill to swallow for long-time loyalists and die-hard "buy American" proponents, but it may also be the company's best shot at a healthy future. To that end, Honda is still a relatively small car company, and one of the few to actually see sales growth in 2008.

09.25.2008
Managing Editor Rick Cotta contributed to this report.